It's about time for the US to get back into manufacturing. Wages in China have gone up enough that the cost advantage isn't as great as it was a decade ago.
The average manufacturing wage in Shenzhen is now about US $36,000/year. US average manufacturing wage is $70,446/year. That's a little under 2:1. A decade ago it was about 30:1.
Industrial production in the USA is near the highest it has ever been. Production has already returned, it's just that all the jobs are very highly automated now. An economy where the majority of jobs are involved in manufacturing is unlikely to ever return.
If the worldwide system of cheap, reliable container shipping network breaks down it'll probably happen (very slowly), along with a firestorm of inflation (that'll be quick).
That's just an argument for moving the actual production to countries where the ratio is still 30:1. Thailand, Cambodia, Vietnam, etc. Maybe even bits of Africa.
That's trading a temporary advantage for a long-term disadvantage. Eventually labor costs will even out globally, meaning moving manufacturing to countries with a 30:1 ratio isn't a long-term benefit. But "onshored" manufacturing, in the long term, would reduce dependency on potentially unreliable (or adversarial) counterparties.
Those numbers are way off, no source is given, it's higher than anywhere else I can find, and the same website seems to think that the average in the UK (where I live) is also £71k per year while the UK National Statistics Office says it is £31.7k (so under half).
A few years ago I started a manufacturing business in a low cost of living part of the UK. Most of our staff make about £2000 per month after tax, which actually works out to just over $36,000 per before tax. This is a good wage for the area.
All of our sales are to other manufacturing businesses, most of which are in the UK/EU.
Most of our suppliers are UK/EU manufacturing businesses too, many of which are local to us.
Obviously that's where automation should and already has kicked in (not for service jobs, but for factory jobs - which are strategically more important anyway).
You are supporting wrong type of Ukraine migrants - we talk about country where average monthly wage was around 300-400$ last time I checked. Given its for completely different cost situation, but there were literally millions of Ukraine economical migrants all over Europe before the war, mostly the eastern part, working for much less than the amount you mention.
Simply because in Ukraine, no one lives on their salary. People hustle. Look at the famous photos of bombed-out Ukrainian places where people were tortured. Pay attention to the architecture, cars, everything. These are anything but poor, dilapidated places with people willing to work for food as the official stats may picture things.
And people who worked abroad are just the unfortunate ones, the underclass, just as it is in Mexico: those who illegally cross to the U.S. are those who couldn't make it at home (often because of discrimination/racism yes). One looking at the desperate Mexicans doing hard work for almost nothing in the U.S. may assume that Mexico is a very poor place - which it isn't.
Now, as the war started, it's the common - much more well-to-do - Ukrainians who started leaving the country, and they already enjoyed much better living standards than people abroad imagined.
Ukraine is much like the rest of Eastern Europe - uneven, fragile, but in general a wide middle class society. It's done with widespread poverty. It's just that vast majority of that wealth is undocumented, and Ukrainian financial infrastructure makes owning, investing and moving undocumented wealth easy. People there have no idea what taxes are. Most never paid anything and don't know how it's done. And sure, it results in corruption, for which Ukraine is famous.
Slovakia and Lithuania have 5x the GDP per capita of Ukraine. I'm specifically talking about countries with similar economic conditions, like perhaps Moldova or Morocco, or perhaps even Bulgaria.
1. Singapore's manufacturing relies on automation.
The GDP share of manufacturing has gone up in recent years, reversing the earlier decline; on the other hand, employment in manufacturing actually dropped as a fraction of total employment in the nation.
2. Singapore offers favorable conditions for automated manufacturing:
A. tech talent pool
B. favorable government support (talent growth subsidy, political stability, IP protection)
C. network effect of other high quality firms in the vicinity.
> It is the world’s fourth-largest exporter of high-tech goods, according to the World Bank. The top three are China, Germany and South Korea. The U.S. is fifth.
This surprised me: Singapore beats the US and Japan in this metric.
For those wondering what kind of manufacturing, article specifically points to GlobalFoundries Fab 7, GE jet engine 3d printing, Siltronic and UMC semi manufacturing, and REC solar panels. BioNTech wants to produce "several hundred million" vaccines with a staff size of 80. Paper bag makers, HP print heads, Hyundai electric cars.
As a Singaporean I had no idea all this was going on. pretty cool. as a more cynical news reader this article is so glowy to the point of propaganda.
I imagine very few people have a problem with employment in manufacturing dropping as a side effect of this. Keep right on.
I was there a decade ago and many foreign run startups were adamant about not hiring Singaporeans for creative or software engineering positions. Something something lack of initiative and free/critical thinking skills. The admin and finance side were mostly Singaporeans though.
To be fair, I am an ex-Singaporean and no longer keep up with matters concerning the island. Left because of the stifling (physical/cultural/political) environment. I visit every few years and find little has changed in those regards.
When I visited in 2013, the NTU was churning out lots of highly skilled and highly motivated engineers every year. If they kept up the pace, they should have a bigger talent pool than Germany by now... In part, that's also because Germany had more stipends for gender studies than for mathematics in recent years, while STEM knowledge is still strongly supported and highly prestigious in South East Asian cultures.
I had the precisely the same experience as a developer there several years ago. Wasnt just the critical/free thinking skills though, developer jobs were disrespected and poorly paid and ambitious people would aim for better paid middle management, civil service, finance or even real estate jobs. Really good developers tended to emigrate to the US.
The government had a bad case of silicon valley envy though and would throw money at things local tech CEOs told them would be a good idea.
Things have changed dramatically and continues to in the wake of China-US tensions (many Chinese companies setting up shop in SG to avoid a risk of getting frozen out from western market access), HK imploding, Shanghai lockdown troubles and political instability in Malaysia
On fin tech, there’s Silicon Valley style critical mass now.
It doesn't mention it but Singapore also benefits from a lot of cheap labor from neighboring countries. Sure the fab is high tech, but the construction guys building the warehouse only cost a few dollars an hour.
Yeah.... live there for a while though and you might find yourself wishing you were somewhere a little behind, especially if you don't agree with the government on every single little rule and prohibition.
I lived there for a year and while I appreciated the efficiency, when I needed it, the feeling of control of every little aspect of life and commerce eventually started to feel oppressive. I could give many examples but let me just choose one - I live in Thailand now and I can state for a fact that the single street I live on has more live music on any given night than the whole country of Singapore. (1)
Maybe that doesn't matter to you, but it sure matters to me. Singapore's one big, very well run, very efficient, very purposeful, corporate campus. Nice place to visit, you wouldn't want to live there.
(1) OK, maybe not every single night of the year - there are concerts and events in SG sometimes. But 99% of the time, absolutely.
As it stands right now, most people are born into poverty. Why? Because they are born into this world, that is already owned by the past generation and they have no place on this planet. They aren't just humans with no possessions to their name, no, it is far worse, they are people who don't even have the right to exist on this planet, people who have been deprived of the very things that should belong to them.
A person born into land poverty has no means to help themselves, it is illegal for them to help themselves until they have bribed a previous land owner with years of their time. Imagine being born into this planet with an obligation to work 15 years to acquire land. Being born is no longer a blessing. Everyone who was born must justify their existence in front of the land owners.
I appreciate your expertise and openness to discussion.
How much of the business/industry cost is HR/wages, would you say? If the industry is already automated, further attempts to automate would not lead to great cost reduction. It seems like a higher ROI approach would be increasing the efficiency of the existing automated processes.
There are areas in the fab that are not fully automated. Lot of backend wafer fabrication (Laser scribing, Chip-on-Wafer-on-Substrate or CoWoS, a bunch of other wild card assembly steps at wafer level, Wafer-to-Tape & Reel processes, etc.) is not entirely automated in terms of material flow in the Fab.
There are usually bigger fish to fry when it comes to Fab cost-reduction w.r.t labor. For example, if there is a trade off between having space for laborers to move about vs. using OHTs, the favor is almost always for OHTs. Why? Because every square foot of the Fab is big bucks. Floor space is king. You'd rather jam more equipment than to put humans that need 4 ft clearance and a whole bunch of OSHA needs.
It'll be an economic burden for sure. Yes, we'll need some more nurses-- about 25-30% more, during which time the working population grows by several percent.
Makes Japan's push for automated elderly assist technology seem prescient. I wonder how far they are getting and will get in the next 20 years. anybody have any good info?
When you factor in cost of living, they'll probably be better off than places like the US.
20 years from now America might have $8000/month starting wages (pretax) with $5800/month rent for a broom closet and thousands of miles away from family and friends. "Poor" countries may only be paying $2000/month, but with $400 rents, $5 dining, public medical services, plus family nearby to help with any troubles you have.
People really overestimate the appeal of their countries as an immigrant destination. The luster is fading pretty quickly as the world is catching up to western standards and online work helps balance the employment scales globally, plus crime rates and conflict generally leveling out.
> 20 years from now America might have $8000/month starting wages (pretax) with $5800/month rent for a broom closet
Hyperbole. You think, for a US average, that nursing comp is going to go up by 20-30%, but rents will go up by 300%?
> People really overestimate the appeal of their countries as an immigrant destination.
When the waiting list is huge, trending upwards rapidly, and many don't even bother to try because of the difficulty in clearing the list... there's pretty clearly significant demand.
That doesn't mean these trends stay true forever, but it's a fair bit of near to intermediate-term momentum.
Wages for jobs with an influx of cheap immigrant labor don't rise (they drop) and rents have been rising exponentially and inflation is accelerating. My figures were likely a bit too optimistic so I do apologize for that. Places I rented for $600/month 6 years ago are now reaching $2000/month now, so assuming the trends hold for 20 years and factoring in the drop in the value of the dollar, rents may very well more than quadruple.
Immigration has been trending downwards for a very long time in the US[1]. There are far more desirable countries these days (such as Canada), and even then, those will likely lose their appeal as well.
> Wages for jobs with an influx of cheap immigrant labor don't rise
If demand for nursing goes through the roof, wages for nurses will rise.
> factoring in the drop in the value of the dollar
If you're factoring change in the value of currency for rents, you should be considering it for in-demand jobs.
> rents may very well more than quadruple.
You're positing a scenario where the population wanting to rent falls, rents quadruple, and wages decrease markedly in real value. This seems to be self-inconsistent.
> Immigration has been trending downwards for a very long time in the US[1].
Immigrants are a larger share of the US population than any time since 1920, and much, much larger in absolute numbers. Net migration is a bit lower in these past 4-5 years than in years previous-- mostly because of restrictive Trump-era policies and decreased illegal migration from Mexico. And they fell off a cliff for the past couple of years because of, well, COVID.
But the actual queues for immigrant visas are also longer than before.
Living in a country with massive demand for nurses that's being filled by immigrants, wages are plummeting. Demand still far exceeds supply.
You can also look at America's farming industry. Demand is tremendous. Wages are incredibly low and dependent on immigrants who'll work for next to nothing, because it's better to accept missed opportunity than risk setting a higher wage standard.
Looking at what you linked, total immigrant population increased by 12 million from 1990 to 2000, 8 million from 2000 to 2010, but about 5 million from 2010 to 2019. Big dip.
> Looking at what you linked, total immigrant population increased by 12 million from 1990 to 2000, 8 million from 2000 to 2010, but about 5 million from 2010 to 2019. Big dip.
Yes, the sharp hockey-stick rise of number of immigrants and their share of the population cannot go straight up forever. The only way immigrants can significantly increase in share of the population, while the population increases, is for net migration to be in excess of long-term historical averages. This is still happening today!
This number isn't smooth, but the average is basically constrained by legislation. Note 1987-1991 is a special case after the 1987 and 1990 immigration acts provided for the normalization of the status of many illegal immigrants. Indeed, even the post-COVID number exceeds all years 1920-1988.
> Living in a country with massive demand for nurses that's being filled by immigrants, wages are plummeting. Demand still far exceeds supply.
Wages are so much higher than source countries (e.g. the Philippines) that -doctors- are frequently relocating and completing supplementary training to serve as nurses in the US. Remittances are 9% of GDP in the Philippines and the Philippines is building capacity to educate nurses that far exceeds internal demand; they have to go somewhere and compensation in the US outstrips other options. The number of immigrants in nursing is artificially restricted by immigration quotas.
Indeed, nursing wages are so high in the US compared to other US professions that demand outstrips supply of nursing education for domestically educated nurses.
> People really overestimate the appeal of their countries as an immigrant destination. The luster is fading pretty quickly [...]
I dunno, some of the US immigration priority dates are still last century (F3 from Mexico, 15SEP97), so demand still seems pretty high. (I also think our system is pretty rediculous, making some people wait for 25 years)
I think Singapore makes it easy to immigrate legally if you have a job offer (like Canada, Australia, HK, etc.). I don't think they allow for "family based" immigration.
That's basically correct, although the top tiers of the employment pass hierarchy are permitted to bring in dependents and parents. Only on long-term passes, though; becoming permanent residents, much less citizens, is off the agenda unless you're willing to sign up your offspring for at least two years of military service.
They have to leave Singapore before a fuzzily defined boundary between 10 and 12yo, meaning it's the parent who has to make the call. Stay beyond that, and they're a deserter who'll be arrested on sight if they ever return.
One just has to look at wages in Sweden and Germany to decide that its not in your best interests as a tech worker to allow immigration floodgates to open.
Wages for a senior developer can be 250-300% higher in the US, with lower taxes. And no, "free" healthcare doesn't come close to making this huge pay cut worth it.
European developers get shafted badly, with the narrow exceptions of Switzerland and London (they get shafted less).
The "immigration floodgates" is by far not the biggest cause of it. Forget developers, engineer salaries are pretty bad across the board compared to the US. Managers, on the other hand, are doing much better.
It's not different for managers. An L6 manager at Amazon for example will make around USD$170k total comp in Munich while new Seattle offers sit at $380k or more.
You will take at least a 55% pay cut -- and that's just pre-tax. Now consider Germany's 44% effective tax rate versus Seattle's 32% effective tax rate. The chasm gets even wider.
You get the double hit of massively reduced salaries and massive increased taxes.
How about purchasing power? Even more bad news. Local purchasing power in Munich is 40% lower than Seattle. Yet another hit.
Don't forget Germany recently also hiked their sales tax to 19%(!!!), which is almost double Seattle.
The higher you get on the seniority ladder, the worse the comparisons get. You can't get the equivalent of US$500k without being an executive, or for extreme outliers. US$500k is garden variety staff level in most top tier US companies.
Work just as hard as your US counterparts for a MASSIVELY reduced rate. Over 10 years, you've lost literally millions of dollars.
> Don't forget Germany recently also hiked their sales tax to 19%(!!!), which is almost double Seattle.
Not sure I would say that 2007 is that recent anymore (when it was increased from 16 to 19 percent ()). Also keep in mind that the EU minimum regular sales rate is 15% and only 4 countries in the EU have a lower sales tax than Germany.
Most are above 20% with the highest being 27%.
Also there is a second reduced sales tax rate for life-essentials (food for instance), which is 7% in Germany.
() Unless you count the half year 2020 where they temporarily reduced it back down to 16%/5%..
I meant the engineer to manager salary ratio is worse than it is in the US - managers make nearly twice the money for a given level of experience.
Afaik the gap is not as bad in the US, but I may be wrong?
Engineers turned managers would actually be fine, but we're talking traditionally educated managers who are often hired separately/brought in from outside.
Needless to say, they're not all that good, especially with modern startups/software businesses. Which plays a part in making Europe suck at them.
yeah, perhaps someone dislikes the username. or it could be an automated flagging decision of some heuristic decision rule.
@checkurprivlege:
your comment https://news.ycombinator.com/item?id=31864002 seems reasonable. i vouched for it and the others. the others comments don't add much value in my opinion, but they don't seem actively toxic, but are maybe closer to noise than signal.
consider posting fewer comments that are each more thoughtful and more likely to contribute something novel to the discussion that others can get something out of. unexpected yet interesting conversation tangents are often appreciated here. fabfabfab is a good role model in this thread: niche expertise, actually somewhat relating to the topic, offering to go into detail if people have specific questions.
